Facing more than $2 million in unpaid property taxes, Vista Health Systems is potentially less than four months away from losing the property where Vista Medical Center East — Waukegan’s only hospital — sits at the northwest corner of Sheridan Road and Glen Flora Avenue.
Lake County Clerk Anthony Vega said at a meeting of the Waukegan Intergovernmental Committee on Thursday that Vista owes more than $1.1 million in 2023 property taxes due nearly two years ago, as well as slightly more than $1 million in 2024 taxes payable last year.
FNA DZ, a company that purchases delinquent property taxes as an investment, purchased the unpaid 2023 taxes, which remain unpaid. No one bought the 2024 taxes, and Lake County is now the lienholder.
Vega said at the meeting that FNA petitioned the Lake County Circuit Court to grant it a deed to the property, thereby transferring ownership. A successful petition makes FNA the owner of the property and the hospital building. Vista has until June 12 to pay the delinquent 2023 taxes.
The Lake County Circuit Court scheduled a hearing for July 10 in Waukegan to determine the future of the hospital property if the 2023 taxes remain unpaid, which could result in Vista becoming FNA’s tenant required to pay rent.
Though Vega said Vista has until June 15, 2028, to pay the 2024 taxes — interest accumulates at 12% per annum — if FNA acquires the property for unpaid taxes, the county’s tax lien is eliminated.
Along with owing Lake County nearly $2.2 million in unpaid taxes, Vista also owes the city of Waukegan $366,000 for unpaid water bills, according to city officials.
Despite Vista’s apparent financial difficulties, Waukegan Mayor Sam Cunningham remains committed to working with hospital leadership, elected officials and community partners to help the hospital remain viable.
“Access to reliable, high-quality healthcare in Waukegan is vital to the well-being of our city,” Cunningham said in a statement Friday. “I remain fully committed to advocating for the resources, partnerships, and improvements necessary to strengthen and restore confidence in our local hospital.”
Cunningham said he wants to see Vista “return to providing the level of care our community expects and deserves.” He will work with other local leaders to enable the medical center to, “strengthen and restore confidence in our local hospital.”
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Vista is owned by Los Angeles area-based American Healthcare Systems (AHS), which acquired the hospital in July of 2023 from Quororum Health Corp. AHS purchased the corporation from Quororum rather than the assets, leaving it with old debts.
Ald. Lynn Florian, 8th Ward, said in a text Friday that she would like to see a not-for-profit organization take ownership of Vista rather than the for-profit AHS. She believes it would “better serve the community.” She has no criticism of the health care professionals working there.
“I am extremely proud and grateful to the employees who continue to do their best to provide good care to our community,” Florian said. “I hope AHS does the right thing and pays their taxes and all their other liabilities that are outstanding to the city and others.”
Faisal Gill, AHS’s chief legal officer, said at the time of the purchase, he anticipated the hospital would be at a breakeven point within a year and then become profitable. Since then, the hospital temporarily lost its Level II trauma center status, and discontinued obstetrical and neonatal services in October amid other setbacks.
Repeated attempts to reach Vista and AHS officials for comment were unsuccessful.